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The end of the road for roadshows

By Jon Hay, Sam Kerr
27 Feb 2020

The shock of the Covid-19 coronavirus outbreak has forced some rapid thinking among capital markets participants. Almost the first impact has been on travel.

Firms have discouraged inessential trips, declined meetings with people arriving from affected areas, quarantined staff and cancelled meetings.

But markets haven't stopped altogether. Issuance is depressed because investors are worried about losses; not because firms are incapable of acting. Contingency plans have swung into action, with executives allowed, encouraged or compelled to work from home.

Firms have found ways to replace international journeys. SIA, the Italian payments company, told banks in the beauty parade for its IPO they could pitch by phone or video conference.

The longer the outbreak goes on, the more firms will have to do this. And the more they will realise it's manageable.

This is a valuable discovery. Banks talk about fighting climate change by promoting sustainable financing. A stronger statement would be cutting back on flying.

The carbon footprint of gaggles of issuers and bankers roving half a dozen cities or more on a roadshow is huge. So is the human toll. One ECM banker had to fly from London to LA for one meeting, then fly straight home again. 

A head of bond syndicate flew from London to Washington, DC to pitch for a mandate. He flew straight back to be told at Heathrow he had won. He was on the next plane back to DC to thank the borrower.

These examples are not exceptional.

Technology has negated much of the need to be in the room with a client. While lessening their load on the environment, banks would find freeing workers from such slogging about made them happier and more productive.

As for working from home, financiers may even get to spend some more time with their loved ones.

Or would that be a step too far?


By Jon Hay, Sam Kerr
27 Feb 2020